Professor Spyros Makridakis,

University of Nicosia

Institute For the Future (IFF)

Emeritus Professor, INSEAD

Combining

Blockchain (BC)

and

Artificial Intelligence (AI)

What is blockchain?

A Distributed, Decentralized,

Ledger with some special,

very valuable properties

• Ascertains Trustbetween unknown

parties

• Its Records are

Immutable

(Incorruptible)• Result: Disintermediation

• Result: Costs/Speed

R

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S

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Information is Encrypted and new Blocks are Chained to previous ones

50 Ledgers,

updated

automatically

Disruptive Changes: Traditional Internet

Traditional Internet of Communications/Information

(Sending/receiving emails, searching Google, Tweeting,

using Facebook, listening to music, watching videos, buying

things on line, ordering a taxi, getting money from ATM etc.)• Implications for

> The advertising revenues of Mass Media

> Travel agents issuing tickets

> Bookstores and other retailers

> Phone operators

> Postal workers

> Bank tellers

> Job recruiters

> Librarians

> etc., etc.

The birth of the Giants:

Google, Facebook,

Amazon, Alibaba

The birth of Network firms:

Uber, Didi Chuxing, Airbab,

Linkedin, Expedia, Netflix

“Baloney. Do our

computer pundits

lack all common

sense? The truth is

no online database

will replace your

daily newspaper, no

CD-ROM can take

the place of a

competent teacher

and no computer

network will change

the way government

works”.

Blockchain is today where the Internet

was in the middle of 1990s

Disruptive Changes: Internet of Value

(Being Created using Blockchain)

The Internet of Value using Blockchain (Securely trading virtual

currencies, Transferring money for $2 instead of $20, Drawing/

Executing wills with smart contracts, eHealth records, Land

registry certificates etc.) Implications for

• Travel agents booking vacations

• Taxi and Lorry drivers

• Language translators

• Bankers, Investment analysts/Portfolio executives

• Lawyers

• X-ray, CT scan and eventually many other doctors

• Car Companies and Auto Dealers

• Supervisors and Managers

• Professors

The birth of the NEW Giants

and Network firms ?

AI: A revolutionary technology that teaches

machines to think/learn on their own by analyzing

and discovering patterns in massive data/info

Tabula rasa

Clean slate

Combining Blockchain and AI

Blockchain

The Secure and

ReliableStoring/

Transmission of

Data/Information

among users

without the need

of Intermediaries

Artificial Intelligence:

A revolutionary

technology that

can think/learn on its

own by Analyzingand Discovering

patterns in massive

amounts of data/

info

Artificial Intelligence

Blockchain

D

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T

A

Value Added

• Security

• Reliability• Lower Costs

• Greater Speed

• Standardization

• Cloud Services

Applications• Government

• Health

• Banking/FinTech

• Driverless Vehicles

• IoT

• Supply Chain

• Smart Contracts

• DAO (Decentralized

Autonomous Organizations)

• New applications: Irma

Numerai

Health

Smart Contracts

DAO

Supply Chain

Irma

Numerai

Integrating AI and Blockchain (BC):

Few Applications Great Prospects

Government: Little BC (apart from exceptions), none AI

Health: Some BC, Very little AI

Banking/FinTech: Banking mostly BC, FinTech mostly AI

AV: All AI, Needs a lot of BC

IoT: Mostly BC, Needs AI

Supply Chain: Mostly BC, logistics mostly AI, Needs Both

Smart Contracts: All BC, little AI, Must Integrate the TWO

DAO: All BC, little AI, Must Integrate the TWO

Consider Terrorist Attacks

Combining Blockchain and AI:

Still in its Infancy

Estonia’s eHealth System: The closest you can get

in combining AI and Blockchain

Personalized Medicine

IBM’s Watson and DeepMind’s

Work on AI in Health

The University of Texas, “is

using the IBM Watson

cognitive computing system

for its mission to eradicate

cancer.” Well, now that

future is past. The

partnership between IBM

and one of the world’s top

cancer research institutions

is falling apart. It is

confirmed that the project

(having cost $62 m) is on

hold since late last year.

On AI research, we

(DeepMind) are undertaking

research partnerships with

world-class hospital groups

Moorfields and UCLH,

exploring whether AI

techniques can be used

effectively and safely to

support nurses and doctors.

The results of this work will be

subject to rigorous clinical

scrutiny and will be published

in peer-reviewed academic

journals

Banking and Finance

The M4-Competition

Autonomous Vehicles

Blockchain technology and AI would allow Autonomous

Vehicles (AV) to be truly autonomous. This means that they

could refuel, recharge and park on their own and pay for

those services as well as for tune-ups, oil changes or

whatever other services needed

The blockchain will assign each AV a digital identity that

can follow it, using GPS, everywhere, time-stamping its

location and providing instructions of what to do next

AI will utilize the data collected to determine traffic patterns

and speed up the time of journeys

Blockchain and AI will allow full interconnectivity of all AV

on the road, minimizing accidents, coordinating the flow of

traffic and optimizing the routes to follow

IoT

Blockchain could revolutionize the IoT if applied securely

to the estimated 8.5 to 20 billion of connected IoT

devices that exist in 2017. Exploiting the information they

will generate using AI can transform our homes and

cities and have a profound effect on our life’s quality

AI can provide important advantages optimizing the

functioning of all IoT devices, allowing the trading of

digital assets, the automatic ordering of goods and

services and the enactment of smart contracts.

Eciotify, a startup, specializes in applying blockchain to

the IoT and enabling the use of Smart Contracts between

IoT devices.

Supply Chain (SC)

Blockchain can save hundreds of billions by

eliminating

• Paper-based procedures

• Letter of credits and factoring

• Detailed inspections

AI is being used at present for the logistics part

(scheduling and planning) of SC but can be

extended in the future for the majority of SC

transactions including ordering of material and parts

Smart Contracts, in conjunction to AI, can further

automate SC by specifying how things should be

implemented

Smart Contracts

The purpose of smart contracts is the automation

of business relations by reducing the need for

paperwork and by eliminating intermediaries

(e.g., lawyers) thus decreasing costs

Wills and all sorts of Legal documents can be

done using smart contracts (Ethereum allows the

creation of smart contracts)

AI can be incorporated into smart contracts

assuring that they are legally binding and

allowing their adaption in case of environmental

changes

DAO (Decentralized Autonomous Organizations):

Unlimited possibilities, Breakthrough implications

A DAO is an organization that exists as autonomous

code on the blockchain, with no physical presence or

employing people

The code is embedded into a smart contract that is

executed once the postulated conditions are met

Anyone with an Internet connection can be a participant

(owner), or a resource (work for a DAO)

The code (smart contract) cannot be altered unless 51% of

the participants agree

People can participate in a DAO by buying tokens

(bought and sold on exchanges)

New Applications Combining

Blockchain and AI

Numerai

Crowd Sourcing

What Next?

Short vs Long-Term Predictions:

Amara’s law

Will Cars Replace Horses?

“Nevertheless no machine will ever be

able to perform what even the worst

horses can ̶ the service of carrying

people and goods through the bustle

and throng of a great city.”

(Jean-Baptiste Say, 1828)

Could Jean-Baptiste had ever Dreamed

of Driverless Cars back in 1828?

(The less than 190 years between 1828 and

2017 is insignificant in historical terms)

Kitchen Automation in the Year 2000. Notice: (a) No electrical appliances, (b) Child labor,

(c) How well the helpers are dressed

Automation in the Year 2000: Steam engine machine hatching chicken.

Notice: How well the farm girl is dressed

Science fiction is slowly

becoming science fact

(powered by BC and AI) with

far reaching consequences,

affecting all aspects of our

lives, work and societies

Thank You